The States needs to reduce its headcount

Deputy Helyar suggests that GST addresses that point as everyone would have to pay the tax on anything they buy, but that begs the question of how those people who will, sadly, be the less well off, pay that tax? The answer is, of course, that the system is then modified so that they are protected from the cost of the tax by higher benefits or similar, thus restoring the existing position and actually doing nothing to rectify perceived inequality, possibly making it worse.

People fully understand that although GST is fine in theory, in a small jurisdiction like Guernsey, the cost of collection will be relatively high as a percentage of the money raised. In addition, there will inevitably be higher States’ costs through more civil servants to administer a scheme and, of course, the process and burden of collection would fall, again, on the private sector, particularly small businesses. In spite of loud words of praise for the civil service from parts of the States, the basic fact is that we have far too many public employees.

It is quite ridiculous that the finance industry as a whole, which is still the life blood of economic activity on the island, employs fewer people than the States which generates precisely nothing. As someone said recently it is noticeable that a certain well-publicised civil servant in the UK, who earns more than the prime minister, does, in fact earn less than certain office holders in Guernsey. Everyone is aware of a glaring lack of pride and efficiency in certain departments, a situation which is just ignored and not managed. As a small, or perhaps not so small, example, why was no visible action taken when a flight late one evening recently was suddenly denied permission to land, seconds from touchdown, because the airport had closed? There can only be a very limited number of people responsible for the closure decision. Has disciplinary action been taken? Why not? Such action hugely and disproportionately damages the island’s credibility. Or am I forgetting no one is responsible for their actions anymore?

The simple fact is that the States needs to reduce its headcount markedly, 10% would do as a starting point, and get those people redeployed into the private sector to actually contribute to the island’s economy. Having made a cut of at least that magnitude the services to be provided by the remainder could be reviewed. No one is denying a substantial rebalancing of services needs to be achieved to cater for an ageing population although this must mean certain services need to be withdrawn or substantially reduced.

As Deputy Helyar rightly said, a significant problem is that the public knows these changes are necessary but does not trust the States to carry them through and, hence, is unwilling to pay more for what they regard as an already high tax burden. The recent decisions to remove the benefit cap and go for a substantial increase in minimum wage do nothing to show people there is any sense of economic reality in government. The growth in States expenditure over at least the last decade has substantially exceeded the growth in GDP and hence the island’s ability to fund that expenditure.

Significant change in attitude is needed and not just the trite ‘raise taxes’. First cut costs and then, and only then, look at tax rates.

RICHARD BATTERSBY

St Peter Port